The Economics of Spectrum Management: A Review

Purpose – The objective of the paper is (i) to characterise spectrum as an economic resource and (ii) to use this knowledge to review spectrum management approaches and their economic justification in theory and practice. In particular, it aims at identifying credible alternatives to the three most debated policy options (command and control, property rights and commons). Design/Methodology/Approach – The article takes stock of numerous contributions made available through peer-reviewed academic research, agency (or agency-commissioned) reports, think-tank and industry-sponsored policy papers, online articles and conference papers. This overview permits us to contrast the main spectrum management regimes used in practice with those currently experimented or formulated at a conceptual level (a past/present/future perspective). Findings – Spectrum policy reforms have been the subject of a controversy over the respective merits of two modes of spectrum controls liberalisation: property rights and commons. Ambiguities about what constitutes a socially efficient spectrum management regime emerge from the polarisation of the debate and the conceptual approaches taken by the literature. Empirical research would help unlock the stalemate, but is currently difficult to conduct given limited policy experimentation. If deregulation remains debated conceptually, policy making would benefit from a larger array of spectrum management options than the binary policy choices currently examined. Research Limitations/Implications – The review does not seek to address detailed technical issues, or issues that are specific to particular frequency bands. The emphasis is on the economic interpretation of efficiency and scarcity rather than on technical or functional interpretations. Research Gap – The spectrum management literature has hitherto only been partially reviewed, with much focus on three existing modes of spectrum management but very little on potential alternative approaches, which are important to resolve policy ambiguities. Originality/Value – The multidisciplinary aspect of spectrum management research (economic, legal, engineering, and philosophic) has polarised the policy debate in terms of markets vs. commons, social capital vs. property, freedom vs. regulation, etc. The main contribution of this review is to string these approaches together and lay some foundations for a general theory of spectrum management.